Hello money saving fans, Frugal Femme here, and ready to give my two-pence worth on all things frugal. If you are on the Blackbullion website, then no doubt you are already a little savvy about money, and I would love to hear from you about your own top tips, handy hacks and general frugal high-five moments, so we can all help each other. Caring is sharing, after all.
With that in mind, enjoy my article on Lifetime ISA’s, and see if it could work for you…
An ISA, but not as we know it!!
How is this year going so fast? I feel like January was about a week ago, and now we are already in April. The clocks have gone forward, so Spring has technically sprung, and with that come the joys of Easter eggs, longer days, and for the money conscious out there a new tax year – hoorah!
From the 6th April, there will be something to really get excited about. Free cash!! Kind of…There is a new ISA on the scene, which actually sounds pretty darn good. Aimed at 18 – 39 year olds, the LISA, or Lifetime ISA is a government initiative to encourage long-term saving and is an ISA with a difference, if you will! The difference being that you might actually be able to make a decent return on your money. Currently with a normal ISA the interest rate is so low, that you get 0.000 sod all, whereas with the LISA you get an additional 25% of your investment, so if you put in the maximum per year of £4K, then you could potentially get up to £1K, which will be paid annually in the 2017/18 tax year, and then monthly from April 2018. Interest will be paid too, although this will be based on the contributions paid in, rather than on the entire pot.
Not bad for not really doing much, and whereas you can technically only have one ISA per year, the LISA can be opened alongside a normal ISA, meaning you can also put up to £16K in, to make it up to your total allowance for the year of £20K.
For those starting out on their saving journey at 18, this means potentially earning an additional £1,000 per year for the next 32 years, which would make a nice little nest egg (unless the rules change, of course!). The money could purchase a property under £450,000, which in today’s current climate would probably get you a one bedroom postage stamp in Zone 6, but at least it would be home!! For those who already own a property, the money can be saved for retirement, (65 for men, and 63 and 9 months for women, as of April 2017), and will be a welcome bonus in your twilight years.
Not be a party pooper, but it should be noted that you are only allowed to withdraw the cash to buy a home or when you retire. If you need it earlier for any other reason, there will be a 25% penalty to get at your cash, so before you jump straight in, do a bit of research as to whether LISA is right for you.
Luckily, I just about manage to fit in the age bracket, and it means that I can continue putting money into the LISA until I turn 50. It may not be millions, but it is kinda like free money, and that is always a bonus – ker-ching! Personally, I think getting a bit more bang for my buck at a time when interest rates on savings are far from interesting, can only be a good thing, and a bit of extra tax-free money will definitely put a spring in my step!
Who is Frugal Femme?
So a little about me… By the numbers, I am 30-something, married for 5 years, 5ft 5 (on a good day), size 6 feet, with 0 fillings (quite proud of that fact!!). When it comes to finding ways to save money, what can I say? I just can’t help it. Whether it is an online offer, an in-shop bargain, or a free sample, count me in. Saving money wherever and however I can gives me a warm fuzzy feeling inside. I love finding new ways to make my hard earned cash go that little bit further, and really does make my world go round.